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description

In October 2007, the British band Radiohead caused a stir when it announced it would allow customers to decide how much to pay for its new album, released exclusively as a digital download and available only from the band's own web site. The pricing plan represented a significant break from the industry standard of fixed prices for music, typically 99 cents for individual songs and upward of $9.99 for complete albums. How viable is such a "name-your-own-pricing" plan? And what does Radiohead's move say about the future of the music industry?

learning objective:

To examine how digital distribution is changing revenue and power structures, and how companies and individuals can best respond to such changes, in the context of the music industry. To assess whether flexible pricing plans are an adequate response to the significant strategic challenges in the music and other creative industries.